Federal agents raid 20 Minneapolis childcare centers in fraud probe

Federal agents swept through about 20 Minneapolis childcare centers Tuesday morning, turning a long-running Minnesota fraud saga toward the public money behind child-care payments and the oversight gaps that let suspicion build for months before this show of force.

The court-authorized searches produced no arrests, but they landed in a state already under intense scrutiny for COVID-era scams that prosecutors say have led to 92 charges and 67 convictions since 2021. Five more people pleaded guilty in March in the Feeding Our Future case, the pandemic fraud scheme prosecutors have called the country’s largest of its kind.

At Mini Childcare Center in South Minneapolis, a CBS News Minnesota crew saw about a dozen agents just after 6 a.m., including one taking photos and another carrying a large portable file case inside. Mini Childcare Center had been mentioned in a viral December video by YouTuber Nick Shirley, whose claims about Somali-owned daycares and clinics were amplified by Elon Musk, Vice President J.D. Vance and then-Attorney General Pam Bondi before federal agents now returned with warrants.

The earlier online accusations did not line up neatly with the paper trail. CBS News later reported that state records showed all but two of the centers Shirley highlighted had active licenses, and Minnesota’s Office of Inspector General said that when it inspected nine of the centers in January, eight had children present and one had not yet opened. One site had an unannounced inspection on Dec. 4 that found safety, cleanliness, equipment and training problems, but no recorded evidence of fraud.

That contrast is now at the heart of the broader political fight. In response to the viral allegations, the U.S. Department of Health and Human Services froze Minnesota’s federal child care funding, which Fox 9 reported totals about $185 million a year, and introduced a “Defend the Spend” system requiring justification and receipt or photo evidence before some payments are made. Governor Tim Walz accused the Trump administration of politicizing the issue and trying to defund programs that help Minnesotans, while also launching a statewide fraud-prevention effort and later appointing a fraud czar.

The child-care raids are unfolding as federal prosecutors broaden their lens across Minnesota. In late 2025, they said 14 Medicaid-funded programs had billed $18 billion since 2018 and estimated that half or more of those claims could be fraudulent, a figure state officials have publicly questioned. The Minneapolis-St. Paul area is home to the largest Somali community in the United States, and most of the fraud defendants in the Minnesota cases are of Somali descent, a fact that has deepened political criticism and accusations of stigmatization as federal authorities press on with a wider crackdown.